L&Q and East Thames housing associations have completed their merger, and a successful £2.6 billion refinancing package to help support delivery of their ambitious strategic objectives.
The combined organisation owns and manages over 90,000 homes across the UK, worth an estimated £22 billion.
The newly merged organisation will improve its financial strength and set a vision to deliver 100,000 new homes with half being genuinely affordable to people on average and lower incomes.
Benefits of newly merged entity:
- The combined organisation owns and manages over 90,000 homes across the UK, worth an estimated £22 billion;
- The newly merged organisation will improve its financial strength and, working with like-minded partners, set a vision to deliver 100,000 new homes with half being genuinely affordable to people on average and lower incomes
- The ten-year financial plan allows for:
£15 billion gross capital expenditure in building new homes o £250 million community investment fund to improve the life chances of those who live in the organisation’s homes and communities and to promote independence among residents £5 million per annum for a new training academy to develop talented, qualified staff, and to provide residents with skills and employment opportunities;
- The merged organisation plans to create a new 6,600 home specialist care and support subsidiary with an annual turnover of £47 million to provide a dedicated offer to older and vulnerable adults;
- Continued commitment to 50% affordable housing through shared ownership and rent, reflecting the organisation’s belief that everyone should have a quality home that they can afford. The organisation will combine social purpose and commercial drive, investing all profits back into creating homes and neighbourhoods people can be proud of;
- Maximising capacity and building financial resilience to future markets and economic risk through a focus on cash efficiencies and delivering improved value for money;
- Pursuing significant opportunities for growth, including:
accelerated development throughout London and the South East, including along the Thames Gateway corridor, which has been identified as a long term national priority for growth strengthening existing relationships and forging new partnerships with like-minded organisations – primarily within the South East but looking to expand to new regions where appropriate, e.g. Trafford Housing Trust in the North West o development of strategic land initiatives;
- Targeting an improvement in key financial metrics, delivering £38 million efficiency savings per annum by March 2019, combining the best from both organisations’ operating model, sharing core central services and greater investment in technology
A new brand and visual identity will be launched; further details to be accessed on the L&Q website.
David Montague, Group Chief Executive, said:
“We have built a strong track record over the last 50 years and believe the opportunities ahead for the sector have never been greater. The current Government talks about increasing housing of all tenures, not just home-ownership, and is focussed on long-term targets that stretch beyond the next election. With long-term planning we can make long-term commitments, and we share the Government’s determination and ambition to deliver a step change in housing.
We are delighted with the merger with East Thames. We have the ambition and the capacity to build quality homes, fit for the future, across multiple tenures at a greater scale than ever before. We want to continue to work with like-minded organisations and have the skills and financial strength to make a difference. I would like to thank our staff for their continued hard work and focus, and our residents for their views and feedback during the process. This is an exciting moment and I look forward to working with our new colleagues and residents to deliver our plans.”
Yvonne Arrowsmith, East Thames Chief Executive, said: “Our strong relationships in East London and Essex will help the merged entity accelerate growth in the South East over the next ten years. We believe that everyone should have a quality home they can afford. This merger will allow us to combine our social purpose and commercial drive to create homes and neighbourhoods we can be proud of and to provide even greater support to some of the most vulnerable members of society.”